"... I think it's becoming increasingly difficult to run Moodle 'on the cheap'..."
Which is annoying as Apache MySQL & PHP are all Open Source and FREE. Paying someone to keep things ticking over is money wellspent if that's what they do...but some Host servers just take your money and leave you to it!
Fortunately I don't need to worry too much about which Moodle version I have on my webserver, as it's loaded automatically, and all I use it for is similar to keeping a blog. Moodle 1.9 works lovely, and themes are so much easier to make.
The only problem I am having is that Namsco whom I have been with since the beginning of the century (that's sounds like a long time) use ZEUS (whatever that is) and is not the best protform for Moodle, but had it not been for Petr to add ZEUS into the server configuration files I would probably not be here.
The majority of my testing I do on my Localhost WAMP server. Who knows I may even venture into SERVER technology and become a Moodle Partner in my own right and start hosting Moodle for folks who need it.